Postponed introduction of bank stress-buffering capital regulations as exchange rate surges

As the won-dollar exchange rate soared after martial law, the financial authorities decided to postpone the introduction of bank stress-buffering capital, which was scheduled to be introduced at the end of this year, until after the second half of next year.

Stress-buffered capital regulation is a system that allows additional capital to be accumulated differently according to the analysis of crisis situations by bank.

The Financial Services Commission and the Financial Supervisory Service said the move was prepared to the extent allowed by global standards among suggestions made by financial firms after martial law, and was finalized at a macroeconomic finance meeting.

The financial authorities also said that among the foreign currency assets of the banking sector, structural foreign currency assets of non-transactional nature, such as overseas corporate investments, will exclude market risks from exchange rate fluctuations and other factors from the calculation of risk-weighted assets.

Financial authorities said they plan to continue monitoring financial companies' financial capacity expanded through the measures to be faithfully utilized to support financial stability and the real economy such as domestic companies.